Rabin Calls for Cuts in Services Due to Serious Economic Situation

Premier Yitzhak Rabin called on the Labor Party last night to demonstrate political courage by sponsoring severe outs in government services because of Israel’s serious economic situation. He said Israel could not rely on economic assistance from the United States to continue on its present scale and that the aid obtainable from world Jewry will not increase significantly.

Therefore, Israel cannot plan to cover its $3-$4 billion deficit from foreign aid and has no choice but to impose further austerity, he told a meeting of the Labor Alignment’s economic committee here. There is no escape from acting now, Israel cannot wait until the last moment when its foreign currency reserves have dwindled to take action, he said. He added, however, that for the next year or two, Israel enjoys relatively favorable conditions to cover its balance of payment deficit.